NVAX
Novavax, Inc.
$9.21
High-Growth Software
80%
Revenue × Terminal Margin DCF
Strong
·
Conviction
Undervalued
Trading 83.9% below fair value
You pay
$9.21
Bear
$23.53
Fair
$57.28
Bull
$84.43
Bear
$23.53
+155.5%
18% rev growth, 21% terminal margin
Fair
$57.28
+521.9%
30% rev growth, 28% terminal margin
Bull
$84.43
+816.7%
35% rev growth, 32% terminal margin
Key Value Driver
Revenue growth (30%) × margin expansion to 28%
Terminal Value % of EV
69%
Implied Market Multiple
0.9x
Summary
Our base-case estimate uses a discounted cash flow model based on revenue growth and long-run free cash flow margins. We then blend that result with the average analyst price target of $18.00 from 23 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $57.28 per share.
Warnings
Our estimate assumes profit margins grow from 0% to 28% over 10 years. If that improvement stalls, the company is worth considerably less.
Gross margin of 94% means each dollar of revenue is highly profitable. As the company grows, overhead costs should shrink as a share of revenue, boosting overall profits.
Wall Street's average price target is $18.00 (from 23 analysts). Our estimate is 291% above the consensus -- consider that gap carefully.
Key Risks
- Current FCF misleads — the model values future margins, not today's cash
- SBC dilution is the hidden tax: 2-4% annual share growth compounds fast
- Revenue deceleration is inevitable — the question is when and how steep